7 Best Practices Before Signing Your Franchise Lease
As commercial tenants enter their new
leases, it’s easy to overlook some unfamiliar
lease implications and terms on potential
A little bit of awareness can go a long way
when helping lessees understand their
Following these eight industry best
practices before signing your commercial
lease can help ensure your facility repairs
before you’re open for business while
safeguarding your budget.
Learning and identifying your existing
spatial conditions while doubling down on
recognizing your terms within your lease
agreement is a great starting point before
signing any franchise lease.
If you’re still feeling vague about your lease,
try connecting and consulting with a
national partner. They can provide the right
inspection specialists to assist you on the
front end by accurately pointing out
specific improvement projects that will help
you avoid surprise holdups and costs.
It’s a known fact that everything rests on
your space’s infrastructure, which also
happens to represent the most expensive
component of your construction and
First, to avoid certain infrastructure risks,
determine if you have proprietorship over
your systems in your lease.
For example, if you find out your HVAC unit
requires significant repairs or even a
replacement, are you responsible for that
cost, or is it your landlord? Figuring this step
out can save you $20,000 or more in
replacement costs and other related fees.
A good rule of thumb to know is any
building older than 10-years is at risk for
having hazardous materials like asbestos,
lead, or mold.
These hazards can negatively affect your
tenants, workers, and clients and can
impact the level of your liability.
Planning your construction process around
removing hazardous materials is important. It’s best practice to work closely with inspection specialists to remove them so you’re aware of what you’ll be dealing with regarding the space you choose.
PARKING, ACCESSIBILITY & COMPLIANCE
Every business has to meet parking
requirements. Your newly leased space
may already have a parking lot that may
be near its threshold and may need
additions or upgrades.
In addition, accessibility requirements are
state-regulated, and each pertains to building codes for access ramps, elevators, and restroom plans. In all, your space must
modify to comply.
Landlord’s typically try to avoid paying for these upgrades, so it’s best to work with an
accessibility specialist about specific regulations to help spare your budget while keeping you informed since these codes are updated continuously.
Don’t sign on the dotted line until you
inspect your roof accurately. Poor roofing
conditions can be a pain to manage.
If your new franchise has a leaky roof, some
water damage, or even mold, repairing
these damages can cost tens of thousands
of dollars and disrupt your business flow.
MIND YOUR NEIGHBORS
Consider the relationship between your
space and those of your neighboring
tenants. Are you sharing the building,
parking lot, and walls?
Certain sensitivities can inevitably arise
over sounds, smell, and client
demographics, leading to costly
reconstruction, litigation, or worse,
relocation. Some questions to ask yourself
might be about the fit of your Brand next to
Are you opening a spa next to a pet
daycare? How about a music school next to
a learning center?
Network and meet your neighbors first to
determine who’s in the neighborhood and
figure out the lease restrictions or terms
that might already be in place.
The terms of your lease should include
some landlord-mandated construction
guidelines. However, some landlords will
present lengthy leases with strict criteria for any construction type that will increase
For example, some agreements can
mandate union labor needs, particular
insurance, or even night construction work
to prevent daytime business disruptions.
Discuss in-depth with your landlord about
any contracted conditions and cost effects
before signing your lease.
Signing your new lease can be both an
exciting and nervous endeavor. It’s not
always easy to advocate for yourself during
the lease negotiation process.
Appointing a general contractor to help
steer your construction goals can save you
significant dollars. They can offer
consulting services on your lease
agreements and help determine anything
you’ve might have missed or overlooked to
help protect your investment.
For additional reading, please check out
these resources below:
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